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Questions and Answers
What are the 4 elements of fraud?
What are the 4 elements of fraud?
- Matter false statement, 2. Know statement is false, 3. Rely on false statement, 4. Financial loss
What is the distinct difference between a fraud and an attempted fraud?
What is the distinct difference between a fraud and an attempted fraud?
Loss of money
________ _____________ is the process of making illegally obtained proceeds appear legal.
________ _____________ is the process of making illegally obtained proceeds appear legal.
Money Laundering
What two financial statements are usually provided by a business to a financial institution when trying to secure a business loan?
What two financial statements are usually provided by a business to a financial institution when trying to secure a business loan?
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________ _________ is a financial statement that summarizes a company's assets, liabilities plus the net worth at a specific point in time.
________ _________ is a financial statement that summarizes a company's assets, liabilities plus the net worth at a specific point in time.
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Is a financial statement that reports a company's revenue and expenses and profit/loss over a specific period of time?
Is a financial statement that reports a company's revenue and expenses and profit/loss over a specific period of time?
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What is a division of the United States Treasury Department whose goal is to prevent and punish money laundering?
What is a division of the United States Treasury Department whose goal is to prevent and punish money laundering?
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What is a report that U.S. financial institutions are required to file for each deposit, withdrawal or exchange of currency in excess of $10,000?
What is a report that U.S. financial institutions are required to file for each deposit, withdrawal or exchange of currency in excess of $10,000?
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What is a report that financial institutions must file following a suspected incident of money laundering?
What is a report that financial institutions must file following a suspected incident of money laundering?
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What is the form that needs to be filed by any person who receives more than $10,000 in cash in a single transaction?
What is the form that needs to be filed by any person who receives more than $10,000 in cash in a single transaction?
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What is the central bank of the United States, founded in 1913?
What is the central bank of the United States, founded in 1913?
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Who was the New York City hedge fund manager arrested in 2008 for operating the largest Ponzi scheme?
Who was the New York City hedge fund manager arrested in 2008 for operating the largest Ponzi scheme?
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Name the world's largest anti-fraud organization.
Name the world's largest anti-fraud organization.
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Name the largest international organization dedicated to enhancing AML/CTF knowledge.
Name the largest international organization dedicated to enhancing AML/CTF knowledge.
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What are the 4 primary financial institution regulators?
What are the 4 primary financial institution regulators?
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What are the 2 primary regulators for Wall Street?
What are the 2 primary regulators for Wall Street?
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Name the 4 largest banks in the United States.
Name the 4 largest banks in the United States.
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Name the three lawful ways in which law enforcement may obtain financial records.
Name the three lawful ways in which law enforcement may obtain financial records.
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Who is Joey Coyle?
Who is Joey Coyle?
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What is a fraud pyramid?
What is a fraud pyramid?
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Name 7 countries that are not allowed in the U.S.
Name 7 countries that are not allowed in the U.S.
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What are the components of structuring money?
What are the components of structuring money?
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What does the term red flags refer to in financial transactions?
What does the term red flags refer to in financial transactions?
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What is the Bank Secrecy Act?
What is the Bank Secrecy Act?
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What is structuring?
What is structuring?
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Who is Joey Coyle?
Who is Joey Coyle?
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A ______ _________ ________ (____) is a legal term used to describe businesses that transmit or convert money.
A ______ _________ ________ (____) is a legal term used to describe businesses that transmit or convert money.
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The _______ _________ ____ (___) was created in 1970 to assist in criminal, tax and regulatory investigations.
The _______ _________ ____ (___) was created in 1970 to assist in criminal, tax and regulatory investigations.
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What is accounting?
What is accounting?
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What is OFAC?
What is OFAC?
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What is a specially designated national?
What is a specially designated national?
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Name 10 countries that are not part of the 10.
Name 10 countries that are not part of the 10.
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Who is Paul Manafort?
Who is Paul Manafort?
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What is a beneficial owner?
What is a beneficial owner?
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What does PEP stand for?
What does PEP stand for?
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Study Notes
Fraud Elements
- Four elements of fraud: false statement regarding a matter, knowing the statement is false, reliance on that statement, and financial loss incurred.
Fraud vs. Attempted Fraud
- The primary distinction lies in the actual monetary loss; fraud involves loss, while attempted fraud does not lead to financial loss.
Money Laundering
- The process of making illegally obtained proceeds appear legal.
Financial Statements for Loans
- Businesses typically provide two key financial statements to secure a loan: balance sheet and income statement.
Balance Sheet
- A financial statement summarizing a company's assets, liabilities, and net worth at a specific point in time.
Income Statement
- A financial document reporting a company's revenue, expenses, and profit/loss over a specific timeframe.
Financial Crime Enforcement Network (FinCEN)
- A division of the United States Treasury Department, aiming to prevent and punish money laundering and associated crimes.
Currency Transaction Report (CTR)
- Required for any deposit, withdrawal, or exchange of currency exceeding $10,000 by U.S. financial institutions.
Suspicious Activity Report (SAR)
- Filed by financial institutions when there is suspicion of money laundering, fraud, or other legal violations.
Form 8300
- Must be filed by individuals in trade or business who receive more than $10,000 in cash in a single transaction.
Federal Reserve
- Central bank of the United States established in 1913, providing a stable monetary and financial system.
Bernie Madoff
- New York City hedge fund manager arrested in 2008; sentenced to 150 years for operating the largest Ponzi scheme in history.
Association of Certified Fraud Examiners (ACFE)
- The largest anti-fraud organization providing training and education in fraud detection and prevention.
Association of Certified Anti-Money Laundering Specialists (ACAMS)
- Largest international membership organization focused on enhancing knowledge in anti-money laundering and financial crime prevention.
Primary Financial Institution Regulators
- Federal Reserve Board, FDIC (Federal Deposit Insurance Corporation), National Credit Union Administration, Office of the Comptroller of the Currency (OCC).
Wall Street Regulators
- The two primary regulators are the United States Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).
Largest U.S. Banks
- Notable banks include JPMorgan Chase, Bank of America, Wells Fargo, and Citigroup.
Evidence Acquisition by Law Enforcement
- Law enforcement may obtain evidence through subpoena, consent, or search warrant.
Joey Coyle
- Unemployed longshoreman who found $1.2 million on the street in 1981 after it fell from an armored car and decided to keep it.
Fraud Triangle (Fraud Pyramid)
- Contains perceived pressure, perceived opportunity, and rationalization that can lead to fraud.
Restricted Countries
- Countries prohibited from U.S. dealings: Libya, Iraq, Iran, Syria, Sudan, Somalia, Yemen.
Structuring Money Laundering
- Involves three stages: placement, layering, and integration.
Red Flags in Transactions
- A notable red flag is the lack of identification during financial transactions.
Bank Secrecy Act
- Enacted in 1970, it requires financial institutions to file transaction reports to assist in investigations.
Transaction Structuring
- The act of breaking up money orders into smaller transactions to evade reporting thresholds.
Office of Foreign Assets Control (OFAC)
- Government office that enforces laws regarding economic and trade sanctions against targeted foreign countries.
Specially Designated Nationals
- A block list maintained by OFAC that includes individuals and entities banned from U.S. dealings.
Exempt Countries from Sanctions
- Notable non-sanctioned countries include Canada, Russia, and the UK, among others.
Paul Manafort
- Known for his high-profile lobbying activities and subsequent indictments.
Beneficial Owner
- The individual who ultimately owns or controls an account.
Politically Exposed Person (PEP)
- An individual who holds a prominent public position, impacting their risk for involvement in corruption.
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Description
Test your knowledge on anti-money laundering concepts with this quiz. Explore key definitions and elements related to fraud and money laundering. Perfect for those studying finance, law, or criminal justice.